Click To See Today's Rates

Posted 09/06/2017

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Mortgage rates today, September 6, plus lock recommendations

mortgage rates today

What's driving mortgage interest rates?

Mortgage rates today are lower than yesterday's. There were no economic news releases this morning, so we'll just take our cues from the daily statistics below. This afternoon, the Fed will release its Beige Book, the notes from its previous meeting.

Investors take these notes seriously, as they could signal changes in the Fed's plans. Anything unexpected could cause rates to change later today.

Click to see today's rates (Sep 23rd, 2017)

Mortgage rates today

(As of 10:30 am EDT)

Program Rate APR* Change
Conventional 30 yr Fixed 3.625 3.625 Unchanged
Conventional 15 yr Fixed 2.875 2.875 -0.13%
Conventional 5 yr ARM 3.125 3.666 Unchanged
30 year fixed FHA 3.250 4.180 Unchanged
15 year fixed FHA 2.750 3.626 -0.03%
5 year ARM FHA 3.000 4.099 -0.01%
30 year fixed VA 3.250 3.415 -0.09%
15 year fixed VA 2.875 3.163 -0.09%
5 year ARM VA 3.250 3.384 -0.01%

Your rate might be different. Click here for a personalized rate quote. See our rate assumptions here.

Today's data

Today's rates started low, but data points mostly to increasing rates.

  • Major stock indexes are all up (bad for mortgage rates)
  • Gold prices slipped $2 an ounce to $1,345 (not-good for mortgage rates because gold falls when the economy improves, and an improving economy pushes rates higher)
  • Oil rose $1 to $49 a barrel (bad for rates because higher energy prices trigger inflation worries)
  • The yield on ten-year Treasuries fell two basis points (2/100ths of one percent) at 2.07 percent (great for rates, because mortgage rates tend to move in the same direction as Treasuries -- and, anything below 2.20 is low)
  • CNNMoney’s Fear & Greed Index rose three  points to a "Fearful" 39. This is not-great for rates, because less-fearful investors turn away from bonds and mortgage-backed securities, forcing their prices down and rates up.

Mortgage rates today are still very favorable for home buyers. The climate is highly-encouraging for real estate purchases.

This week

The week is very light on data. You can look for mortgage rate clues at three am when Presidential tweets emit from the White House, or analyze your tea leaves in the morning -- or you can just read this column until you get your rate locked.

  • Later today: the Fed releases its Beige Book, which contains notes from the last Federal Open Market Committee (FOMC). Investors pay attention because it indicates how Fed governors are thinking.
  • Thursday: Weekly unemployment claims (242,000 predicted)

The daily data will probably have more importance this week because there will be so few reports.

Rate lock recommendation

Today is a great day to lock a mortgage. Rates are even lower than they were yesterday, but signs point to possible increases later.

Here's the recommendation:

  • LOCK if closing in 7 days
  • LOCK if closing in 15 days
  • LOCK if closing in 30 days
  • LOCK if closing in 45 days
  • LOCK if closing in 60 days

What causes rates to rise and fall?

Mortgage interest rates depend on a great deal on the expectations of investors. Good economic news tends to be bad for interest rates, because an active economy raises concerns about inflation. Inflation causes fixed-income investments like bonds to lose value, and that causes their yields (another way of saying interest rates) to increase.

For example, suppose that two years ago, you bought a $1,000 bond paying five percent interest ($50) each year. (This is called its “coupon rate.") That’s a pretty good rate today, so lots of investors want to buy it from you. You sell your $1,000 bond for $1,200.

When rates fall

The buyer gets the same $50 a year in interest that you were getting. However, because he paid more for the bond, his interest rate is not five percent.

  • Your interest rate: $50 annual interest / $1,000 = 5.0%
  • Your buyer’s interest rate: $50 annual interest / $1,200 = 4.2%

The buyer gets an interest rate, or yield, of only 4.2 percent. And that’s why, when demand for bonds increases and bond prices go up, interest rates go down.

When rates rise

However, when the economy heats up, the potential for inflation makes bonds less appealing. With fewer people wanting to buy bonds, their prices decrease, and then interest rates go up.

Imagine that you have your $1,000 bond, but you can't sell it for $1,000, because unemployment has dropped and stock prices are soaring. You end up getting $700. The buyer gets the same $50 a year in interest, but the yield looks like this:

  • $50 annual interest / $700 = 7.1%

The buyer’s interest rate is now slightly more than seven percent.

Click to see today's rates (Sep 23rd, 2017)

 

The information contained on The Mortgage Reports website is for informational purposes only and is not an advertisement for products offered by Full Beaker. The views and opinions expressed herein are those of the author and do not reflect the policy or position of Full Beaker, its officers, parent, or affiliates.

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2017 Conforming, FHA, & VA Loan Limits

Mortgage loan limits for every U.S. county, as published by Fannie Mae & Freddie Mac, the Federal Housing Administration (FHA), and the Department of Veterans Affairs (VA)